Kotak Mahindra Bank hikes base rate by 0.25% to 8.25%

Following the trend of its peers in the industry, Kotak Mahindra Bank today has announced hikein its minimum rate of lending or base rate by 0.25 per cent to 8.25%.Asset Liability Committee (ALCO) of Kotak Mahindra have met today in the Mumbai headquarter office and decided to review the rate."There has been a sharp hike in the deposit rates both on the retail and wholesale side. Base rate is driven by a formula and the hike in deposit rates triggered the increase," the bank's Group President Treasury Mohan Shenoy told PTI here.Many banks, including Union Bank, Punjab National Bank, Bank of India, IDBI Bank, Indian Bank, Indian Overseas Bank, Allahabad Bank, Dena Bank and Standrad Chartered Bank have raised their base rates in the recent past.The base rate is the lowest rate below beyond which banks could not offer loans. It was first introduced in the month of July with the objective of bringing in more transparency and replaced the Benchmark Prime Lending Rate (BPLR).Kotak Mahindra Bank also raised its BPLR by 0.25%t to 17% for the old borrowers, Shenoy said.

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